Stubborn IPO lull defies supply and demand logic
09/07/2024 14:45
(The author is a Reuters Breakingviews columnist. The opinions
expressed are his own.)
By Jeffrey Goldfarb
NEW YORK, July 9 (Reuters Breakingviews) - Despite solid
market debuts by Reddit, Galderma and Viking, the $49 bln raised
in the first half is the lowest tally since 2016. It’s vexing
for buyout firms with $3 trln of assets to sell and investors
with $10 trln in cash to spend. Economic theory suggests a price
imbalance.
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CONTEXT NEWS
New issuers of stock, excluding special-purpose acquisition
companies, raised approximately $49 billion worldwide from
initial public offerings in the first half of 2024, according to
preliminary data as of June 24 from Dealogic. The amount was
about 16% less than the same six-month stretch in 2023 and the
lowest since 2016.
Spanish cosmetics and perfume company Puig raised $2.9
billion in April for the largest IPO of the half, followed by
the $2.5 billion raised in March by Swiss skin-care products
maker Galderma.
Total equity sales worldwide, including follow-on offerings,
SPACs and convertible bonds, in the first half were about $309
billion, a nearly 12% increase from the same span a year
earlier, per Dealogic.
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IPOs have been broadly lagging stock markets https://reut.rs/45SA2VM
Buyout firms own heaps of assets ready to sell Buyout firms own
heaps of assets ready to sell https://reut.rs/4corcBw
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(Editing by Jonathan Guilford and Pranav Kiran)
((For previous columns by the author, Reuters customers can
click on GOLDFARB/
jeffrey.goldfarb@thomsonreuters.com))